Utilities Firms Support Ofgem 'Debt' Scheme

Utilities Firms Support Ofgem 'Debt' Scheme

Article excerpt

British Gas and Powergen are among major utilities brands that have given their backing to rolling out a pilot scheme which enables debt-laden customers to switch brands.

The decision comes at the end of a three-month industry-wide pilot led by industry regulator Ofgem. The pilot allowed customers who owed money to their current provider to transfer to a new provider - even though they had not paid off their existing gas and electricity bill.

An undisclosed cap was set on the level of debt allowed. In the past utilities companies have employed a tactic known as 'debt blocking', to hold on to customers by making it impossible to switch providers before settling their bill.

British Gas marketing chief Nick Smith said the initiative would help to improve service in a market dogged by poor systems. 'Processes in the utilities industry are riddled with problems and are not customer-oriented at all. We're very keen on this initiative,' he said.

John Evans, marketing director at Powergen, also welcomed rolling out the scheme as it 'encourages competition'. …